Posts Tagged Taxes

Clunker Drivers Have Been Bailed Out…Where’s The Outrage?

Posted by Scott in Entitlements, Gov't Spending, Taxes on August 29th, 2009

It was less than a year ago when Wall Street firms started seeing the first wave of government bailouts.  Shortly thereafter the media and “Main Street” started crying about corporate excesses and greed.  Those same people, however, are praising the “successes” of Cash For Clunkers; even advocating for a sequel Dollars For Dishwashers.

Why was Clunkers a success when the Wall Street bailouts were a miserable failure?  Essentially they amounted to the same thing, the only difference was the recipients of our tax dollars.  Where’s the outrage against those who were able to get a discount on their new automobile?  Where’s the public disclosure (maybe a bumper sticker to thank the rest of us for their new purchase)?

Now I’m not trying to say that I agree with the Wall Street bailouts, because I don’t.  I’m just trying to figure out how it’s OK to bailout one group of people and not another.  The dollar amounts are irrelevant – the principle is the same.

After all, wouldn’t it just be easier (and more Constitutional) to simply not tax us as much?  Lowering taxes for everyone across the board would not only help the auto industry and big Wall Street firms, it will also help every other industry.  If everyone has more money to spend, they will spend it where they see fit.  Whether that’s a new car, or a new dishwasher, the money will be spent, and the economy will eventually correct itself.

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Cash For Clunkers Thank You For Proving Our Point

Posted by Scott in Entitlements, Gov't Spending, Healthcare, Taxes on August 21st, 2009

For years, conservatives and liberals have clashed over taxes.  Do we tax less, and allow the free market to thrive with the increased spending, or do we tax more to allow for an increase in government spending.

Cash For Clunkers has proven the conservative point of taxing less to benefit the economy, and here’s how.

Everyone, especially liberals are pointing out that one of the successes of Cash For Clunkers is that if you give people money, they will spend it.  But why did the government have to place restrictions on how it could be spent?  Had they simply not collected that $3 billion from the American taxpayer, we would have spent it as we saw fit to begin with.

Not only would people inevitably have purchased new (or even used cars), they also would have had additional money to pay for things like, gee I don’t know, maybe health care? 

This leads me to another point.  Cash For Clunkers was supposed to last until November.  Whether it was the apparent “success” of the program, or the flaws in the paperwork processing that caused the program’s early departure, it was still cut short.  What happens when the proposed universal health care ends up becoming too “successful” for its own good, or the inevitable mountains of paperwork become too much to handle?  Are people going to be left waiting weeks or months for the treatment they desperately need (similar to the auto dealers waiting on payments they also desperately need)?

It’s time to see the light at the end of the government sponsored tunnel.  More government involvement than is absolutely necessary in anything is never a good thing.  And right now there is definitely far more than is necessary.

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Pay Your Taxes If You Have Political Ambitions

Posted by Scott in Taxes on May 15th, 2009

Before Timothy Geithner became the  Treasury Secretary, he worked for the International Monetary Fund (IMF).  The IMF employs people from all over the world, including Americans.  While working there, foreigners don’t have to pay US income taxes, and in an attempt to be fair to the Americans who also work there, the IMF pays the Americans for their share of income taxes.

This doesn’t mean that Americans are exempt from paying taxes in the US.  This is a minor detail that Timothy Geithner missed during his tenure with the IMF.  Because of the fact that the IMF didn’t pay taxes on his behalf, he was considered an independent contractor, or self-employed.  Under the US tax law there is a concept of self-employment taxes, where the individual is both the employer and the employee for all intents and purposes.  This means that they have to pay the employer and employee portions of payroll taxes.

Not only didn’t Geithner pay his self-employment taxes, the IMF reimbursed him for what he should have paid had he been a law abiding citizen like the rest of us.

It turns out that this isn’t the last time that Secretary Geithner followed laws as if they were a suggestion, rather than the rule.  Turns out that all of the bailout money being paid out by the billions is unconstitutional as well.

Article I Section 9 of the US Constitution states that “No money shall be drawn from the treasury, but in consequence of appropriations made by law…”.  This isn’t just a minor point the founding fathers decided to throw into the Constitution.  

Secretary Geithner got around this Constitutional issue when the Emergency Economic Stabilization Act of 2008 was passed.  According to a report by the Congressional Budget Office, this established the Troubled Asset Relief Program, or TARP as it has become more popularly known.  This authorized “the Treasury to purchase $700 billion in assets to alleviate the crisis in credit markets”.

Essentially, this gave him a blank check to hand out $700 billion to “stabilize” the economy.  A stabilization effort, which will take years to pay back if any of the bailed out companies go under.

Isn’t it nice of him to hand out our taxpayer dollars when he isn’t even willing to pay his own fair share?

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Quit Bashing The Rich!

Posted by Scott in Entitlements, Taxes on April 15th, 2009

To all of you out there who think the rich are evil and need to be put in their place – STOP COMPLAINING!

You’re also probably complaining that they don’t pay their fair share of taxes.  Since they make so much more than the average Joe out there, they should have to pay more, a lot more, right?

Well guess what?  They are already!  According to the Congressional Budget Office, in 2006 (the most recent year which data is available), the top 10% of households shared almost 73% of all individual income tax liabilities.  The top 5% of households was over 60%, and the top 1% was over 39%.

Think about how fair that is. 

If you were to go out to a fancy dinner with 10 friends, and the bill came to $1,000, would you have the person with the highest income pay $730 for his dinner, and split the remaining $270 among the 9 others?  If you did, I’d bet that friend would find another group of people to go out to dinner with!

Then how is the current scaled tax system fair?  Just because you don’t know the highest income earners personally, doesn’t make it right to stick them with the bill for your issues, does it?  Think about the dinner example.  Why should the rich person have to pay 73% of the bill if all he had was a salad, and everyone else got to eat steak?

Just some food for thought.

Source:
http://cbo.gov/publications/collections/tax/2009/tax_liability_shares.pdf

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Are We Headed for a Welfare State?

Posted by Scott in Other on March 29th, 2009

With the proposed programs in the Obama administration’s budget, it appears as if we’re on a collision course with becoming a socialist state.  European countries have been on this path for decades, with universal health care and other similar programs.

The question one has to ask is, has any of these programs worked?  And in order to answer that question, you have to define what the expected result is.  If the result is to have everyone pay for everyone else’s health care, for example, then the program is a failure.  If it is to give everyone access to health care, then again the program is a failure.

In the UK, taxpayers fund the government sponsored health care system where everyone has “access” to health care.  I say “access”, because, yes everyone is “entitled” to health care for “free”, it just depends on how long you have to wait for it. 

It is perfectly reasonable for one to assume that if you have a potentially fatal disease, you should be moved to the front of the line, and you receive top priority.  However in the UK, they work on a quota system of sorts.  What this means is the government budgets for a certain number of open heart surgeries, brain surgeries, and other like treatments each year.  Once the quota is met for the year, anyone waiting for treatment has to wait until the next year.  Even if they are at risk of dying before being treated.

So is this what we want?  In an on-demand society that complains about a 3 hour wait in the emergency room, do we want to wait months to be treated for serious illnesses?

Hospitals are businesses like any other, except they also accept insurance as a form of payment.  If you don’t have insurance, they’ll put you on a payment plan.  While this may be financially difficult to those without insurance, it shouldn’t force everyone else to have to pay higher taxes.

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